The Export Credit Insurance Corporation (KUKE) did not observe a significant weakening of the payment condition of contractors in May, the company’s deputy president Tomasz Ślagórski stated.

"In KUKE we still do not observe a significant weakening of the payment condition of our clients' contractors, and the loss ratio remains at a level similar to the year before. However, it is difficult to expect that the following months will not bring any deterioration in this respect. Many companies have to face the huge challenge that there is a decrease in demand, which was demonstrated, among others, by the results of industrial production and retail sales for April, which decreased by almost 1/4 (by 24.6% and 22.6% respectively) on annual basis,” Ślagórski wrote.

As he pointed out, after the normal operation of the administration and courts was restored, there was a clear increase in the number of insolvencies in the enterprise sector. Currently, however, the data can hardly be considered as fully reflecting the current situation in the economy, because many companies use various temporary assistance instruments made available by financial institutions, including as part of the next installments of the government's Anti-Crisis Shield.

According to KUKE data, almost 50 companies went bankrupt in May, which means an increase of 63.3 percent compared to April and by 16.7 percent relative to May last year. The number of restructurings announced was 37, or 48.0 percent more than a month earlier and by 8.8 percent more than a year ago. The number of insolvency (bankruptcy and restructuring proceedings) reached 86, so it was 56.3 percent higher per month and by 13.2 percent on an annual basis.

(PAP)